NEW YORK — With oil prices hovering at $47 a barrel and inflation held at bay — at least for now — investors enjoyed the biggest four-day rally in six months. Each major index finished the week with hefty gains of roughly 3 percent.
As a result, the WWD Composite Stock Index climbed 3.27 percent over the week to close at 1,113.03 on Friday from 1,077.81 the prior week. The S&P 500 increased 3.05 percent over the week to end at 1,189.28.
Federal Reserve chairman Alan Greenspan said that energy will “remain central” to the economy’s health, in a speech at the Economic Club of New York on Friday afternoon. Retail analysts have linked rising oil prices with this spring’s soft sales. Growing private inventories of crude oil in the U.S. helped moderate prices, Greenspan said.
Also bolstering Wall Street’s confidence was a gain in the Consumer Price Index, which jumped 0.5 percent in April — higher than expected. But the core CPI was unchanged, which means little or no inflation.
Tempering investor optimism were several analyst reports on Friday that predicted an inventory glut in the teen denim segment for the back-to-school season. Excess inventory levels or longer inventory turns can reduce gross margin rates.
Over the the past few years, retailers have worked to improve their inventory positions. If the denim glut occurs, investors fear profits at certain retailers could be negatively impacted.
Reflecting sector-wide concerns over inventory, Emanuel Weintraub Associates is holding a seminar called “Supply Chain/Speed-to-Market” on June 14 at the Princeton Club in New York.
The session will cover product development, production and distribution, and will feature sector leaders such as Peter Longo, president of logistics at Federated Department Stores; Chuck Gilreath, senior vice president of sourcing and systems at Saks Department Store Group; Rob Birkins, senior vice president of sourcing at Sears Holdings Corp., and Trudy Sullivan, executive vice president of Liz Claiborne.